October 25, 2012

Aurora signs agreement for dairy plant in Russia

 

 

Aurora Organic Dairy has inked a deal with Russia to construct the country's first organic dairy farm and processing plant.

 

Aurora's Russian division signed the agreement with the Ulyanovsk regional government earlier this month. Under the deal, Aurora Organic Dairy will establish and run the facility.

 

An investment will facilitate the construction of a farm to house 5,000 cows, and a milk processing plant. Once fully operational in mid-2015, the processing plant will boast a production capacity of 150 tonnes of dairy products per day.

 

According to Moloko Holdings, the processing plant will be run in accordance with international organic standards.

 

Organic milk and butter - exclusively for the Russian market - will be manufactured at the plant.

 

Chief expert of Russian agriculture at analysis and trading agency, Agrorucom, Vladislav Vorotnikov, said that consumer demand for organic dairy products in Russian is expected to explode in coming years.

 

Vorotnikov has attributed the anticipated growth to Russian consumer increasing interest in healthy living.

 

"Potential demand is currently estimated at up to 400,000 tonnes of organic dairy products and it will rapidly grow in coming years because a large number of Russian consumers are currently keen on the healthy food," said Vorotnikov.

 

He added that through its collaboration with the regional government in Ulyanovsk, Moloko Holdings is likely to benefit substantially.

 

"Russian authorities have typical conditions of collaborations with the foreign investors on such projects. Firstly, Ulyanovsk region could provide a preferential tax regime for the enterprise. It could also be provided access to communications, energy supply, and direct assistance on the construction of accommodation for employees of the farm," Vorotnikov added.

 

Moloko Holdings Inc intends to target its products at mothers and children in need of "healthy organic dairy products."

 

"We are ready to introduce advanced organic technology, to share experiences regarding fixing of norms, rules and standards of organic production in the Russian market, which compliance allow to save all the useful properties, vitamins, amino acids and trace elements [of milk products] and deliver a natural, pristine product to the consumer," said the firm.